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tv   Mad Money  CNBC  May 6, 2014 6:00pm-7:01pm EDT

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yahoo. holding on to their after-hours shares. everybody says it's still a buy. >> i own it. >> i think you can take this thing higher. >> i'm melissa lee. see you back here tomorrow. don't go my mission is simple -- to make you money. i'm here to level the playing field for all investors. that's always a bull market somewhere. i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm just trying to save you money. my job isn't just to entertain but to educate you. call me at 1-800-743-cnbc. or tweet me @jim cramer. sometimes there's a struggle, a tug of war for the very soul of the market. usually it plays out in the subtle fashion.
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nothing like a subtle winner duking it out against a loser. stocks don't fight each other. but on days like today with the dow sank 130 points, s&p tumbled and then the nasdaq, wow, 1.38%, the clash is so obvious we can't resit -- resist visiting the battlefield. so who is getting the spoils and who's getting vaporized? while almost all stocks ended down today, you have to think about relative winners and losers and that means you want to continue to bet on the major cord, to bet on value, not growth, as growth just got pulverized. well value held its own and outperformed the benchmarks that a what money managers want. this contest it's nothing new.
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these two cohorts have been going at it all year, but it's only recently that the match has become one sided. as the fastest growing companies with little or no profit have been crushed. sell sell sell. sell sell sell. on both up and down days often. while the most profitable enterprises with decent growth, sure, they take lumps on days when the markets take lumps today, but they snap back. understand that it doesn't matter whether a company is from tech or health care, the sector isn't it positive, but what hams is profitability. overlay that on valuation. so you can't necessarily sneer at chinese e-commerce giant ali baba which promised to have both growth and profitable. this ipo could be the largest ever. remember, yahoo! has a stake in it. while i don't like the timing,
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some ipos are crushing the market. i recognize that this company will be irresistible to many. if it is priced reasonably. we don't know what the price will be because it's set such strong growth and profitability. my problem is that it's such an easy way to say the largest deal is being priced and that means it's the top and the bell does go off. oh, by the way, don't be so quick to jump on old fashioned growth as being a great repository of value. whole foods got hammered after the close when it reported very disappointing numbers. something that we did foreshadow in last week's game plan. perhaps it's no more stark than two stocks than we all follow, twitter and apple. both were down today, but the trend i think speaks volumes about what's winning and losing. what's working and what's not. as apple fell about a percent
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today. much less than the nasdaq but remains up 6% for the year. while twitter -- twitter has been positively laid to waste. tumbling about 50% this year, including a staggering 17.81%. in today's session alone. this war between the once scorned value stocks like apple and the high flying momentum names that we love like twitter is a perfect metaphor for what's going on right an wrong in this market. what's loved? what's hated, who's making money. who's costing you a fortune. first, let's begin with today's acti action. apple starts with another breakout to the upside. it roars up to the new high, the first time it's been over $600. before it was ultimately dragged
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down by the broader market in the session. was there any real news that caused apple to spike to new highs when all other stocks were headed lower? i don't know. i looked around. made sure there were chatter about some interesting phone designs. as well as a new and talented marketing officer from burberry last week. but the real merit and substance i could find to explain apple's morning rally -- frankly, i think it was the interview that carl icahn, a huge shareholder, gave to wapner here on cnbc saying he's happy and he won't turnip to a seller. think of that. here's a hard-bitten elderly opportunistic. he's seen all kinds of markets, that's what i mean, not age discrimination. and yet, despite its long run, remember this stock was $400 11
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months ago, he's not cutting it loose. how about the news for twitter? i think it's about as polar opposite as the news propelling apple. maybe diametrically opposed. what happened today? it was the expiration of a lockup, meaning to rein in insider selling. it was over. and the flood gates opened. for those of you unfamiliar with the lockup, insiders have to decide how much stock they want to sell. they typically agree to wait six months when their agreement not to sell expires. no insider sold the ipo. that was a positive statement of conviction in the future and one of the reasons i believe that the stock has been a fabulous performer until lately. but after peaking, it's become a death star. it's horrendous. there's lots of worry when the
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lockup expired the big guns would let some go, right? perhaps in the giant secondary offering, like so many others have been doing since the peak and then they have hideous declines after the deals. how, in a highly unusual s.e.c. filing, two twitter cofounder and officer dick cost low swore off the opportunity to sell. they said they wouldn't let the stock go. several venture capitalist pledged the same. all told, 20% of the shares outstanding said they'd stay the course and not dump stock. nevertheless, as we found out today when the lockup expiration occurred there were tens of millions of shares that were just freed from the restrictions and a ton of stock hit the open market from the get go. now, i don't want to point fingers, who the blame the people? the initial public offering came at 26. those who sold today got much better prices than that. you can't blame anyone for taking a profit from the ipo price, but you can fault them from turning gains into losses. that's what unforgivable.
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there are two models that could be at work here. there's the year 2000 model because they knew their companies were goners so they were totally insensitive to the current price. and no, i think many of the companies fit the 2000 model. then that's the 2014 model where we're seeing some restraint like we saw from twitter's cofounder and ceo. believe me if they thought this was going the way of the dotcom there would be no pledge not to sell. but it's not like the insiders are buying either. while twitter can reinvent itself on the fly as another once disappointing stock did that led to awesome profitability i don't see any profitability on the horizon at all. i don't see any accelerating growth at all. which is why i'm adamant for so long that you sell twitter stock. even after today's decline i still regard it as one of the
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most expensive stocks i follow on any metric which brings me back to apple. apple has been advancing. on january 30th, apple hit a low of $499 a year. at the same time twitter stood at $56, what drove apple up? was it time lines, monthly average users, love of the website per share? no, it was earnings per share. as in earnings sharply better than expected. so much better than expected that even though the stocks vaulted higher it sells for 14 times earnings. and geez, that's cheap. no wonder the company is buying back billions of dollars of stock. it's a good investment. is there tremendous insider selling on apple? no. it is being done opportunistically. meaning when the stock gets hammered, apple's management is in there bringing stock in.
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there's ton of twitter stock hitting the market at the same time there's tons of apple stock being retired. no buy back for twitter. no dividend. another lovey blanket the market likes in the end it didn't matter today. it had an overall impact on the psyche, bringing down apple with it. great returns were able to buck the trend. i don't expect tomorrow to bring a reversal of fortune. remember last tuesday we said we did not like them, we saw a number of disappointing reports tonight. fireeye, just annihilated on the guidance. yelp, off 13% today. having erased the gains from the other day and then some. it's a sign post on the momentum to oblivion. i expect it could be bought by another company but no stability here. a stock goes higher in this market, if it represents some
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value. it's cheap and it's not flooded with insider selling. by the way, like zebra and pitn pitney bows from later on in the show. a as stock goes down when insiders head for the exits, not supported by dividends, not supported by buy back, but supported by what seems to be flimsy and slowing growth. so here's the bottom line. while most stocks were down today we got a glimpse in the morning of what this market wants which is true value like the hardware that you carry home from the store. what doesn't it want? what if insiders didn't want at twitter. a stock that goes down because it's backed by the full faith and credit of tweets, a couple of bold mentions and a drawing of a bird. bob in new york, bob? >> caller: hi, this is bob from poughkeepsie. i love the show. you're amazing. i'd like to get your opinion on irdm, iridium.
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the subscriber revenue is growing like mad. great valuation but the most exciting part, they're on track to launch the next generation technology. however, the news is that yesterday about day ago they an noumsed a $50 million stock purchase agreement and the stock pulled back to 681, what do you make of it? >> i got burned badly on it. i recommended it not that long ago. boy this show flies. it did not work. i'm once burned, twice shy. i'm not a fan of iridium. rick in arizona. >> caller: hey, good day, booyah to you. hey, i have an interesting stock that needs your insight and analysis. a company which should be doing well and well entrenched into the environment of the internet of things. they beat estimates, given a
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positive value going forward, yet they have been pummelled since reporting. can you add any color to the goings on of atmel corporation? >> it's an oaksy -- okay semiconductor company. they screwed up on mobile, but i'm not saying they're not real. i'm saying that atmel needs to do something to bring out value like others are doing. they're not doing that. so it's kind of a -- if you get my drift. we saw more today, which side won? the one that represented value. that's what the markets want. they want buy back and dividend and value. coming up, an anniversary, i do not like celebrating. the crash four years ago today and we continue to watch the battle of man versus machine. who is really winning? get my take. when you buy a home it's about location, location, location, but let's go off the charts and plot some prime estate.
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and how is pitney bowes' stock up over thelast few years? we'll tell you after the break. more "mad money" after the break. coming up, call of the wild. zebra technologies might be an exotic beast to you, but it's no stranger to the world's biggest companies. amazon, walmart, even the u.s. air force on putting the technology to work. now cramer is doing his job to see if it belongs in your portfolio. don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet cramer, #madtweets. send jim an e-mail to or give us a call at 1-800-743-cnbc. miss something? head to
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mattress price wars are on now at sleep train. ♪ your ticket to a better night's sleep ♪ four years ago today, the machines terminated a huge amount of confidence in the stock market. yes, it's the anniversary of the flash crash.
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it's upon us. it's worth commemorating if only because no single event seemed to undermine the whole equity class as much as that 900-point intraday drop. i wren it well. i used to do a segment called stop trading. and the period that it took me to walk from my desk to the newsroom, the dow dropped more than 100 points after already being down 200 point. while chatting with erin burnett, it dropped another 600 points. that is correct, the market fell apart while i was there. i shouted to the rooftops that it was time to buy. start with procter & gamble so you'll end up paying well above the plummeting price. take a look. >> let's take a look at p&g. all right. this is going to say everything. p&g is now down 25%. >> well, that's true. if that stock is there, go and buy it. take me there. that's not a real place. >> that stock was down --
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>> all right. this is an -- >> just go buy proctor & gamble. >> 49.25 for proctor -- i mean this -- >> that's -- that name -- >> when i walked out it was at 61. when i walked out it was at 61. it's at 47, well, that's different security entirely. what you have to do though, you have to use limit orders because it jumped seven points. i liked it at 49. >> look at it. >> it's a fast market. >> market was down 900 points. now down 688. >> i know flip it at 59. i just pay 500 gs. >> hey, many viewers thanked me for snaring some proctor & gamble. that actually happened. ever since though, many people
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have asked me how did i know that stocks weren't done for a real reason? there were greek rye rots that day and they thought those riots could spread and the market was telling us this would be bigger and worse than we thought. that was not my approach. i was watching the ticker tape when i was out there. which for some reason had more proctor & gamble and i keyed in on it because i knew it. if the situation was greek, so what? proctor is a big comeback kid. believe me, i was no seer that day. i just had one thing going for me. a deep distrust and an outright cynicism about the way the machines trade your stocks. i believe then and now that the machines are the enemy of you, the enemy of all investors who i care about. because they distort the market and suck out liquidity which is what happened during the flash crash despite the denials of people who should be ashamed. stop it already, clowns.
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it quickly disappeared when they see supply coming and they totally were worthless that day. they hide under the desk. that's the only day that i had seen it matters when it comes to making the market orderly. that's the reason we should allow financial engineering and high frequently trading in general. the flash crash exposed the fragility of the system. it demonstrated that equities can fall apart in the blink of the eye. and it seemed to work a little, but the horses left the barn. confidence in stocks as an asset class never returned from that day. never got back there. it's funny. if i hadn't been distrustful i couldn't have been helpful that day. if i hadn't been so scornful i would have been useful. in the end it was about the lack of regulation and integrity in the system. if it happened again i'd do the same thing. it's the last guilty until proven innocent and it will remain that way until the
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government levels the playing field in favor of your who was eviscerated over 30 minutes of insanity four years ago. stay with cramer. coming up, homeward bound. housing prices have been on the rise. but housing stocks haven't followed suit. as home buying season gets into full swing, could things change? and rfid. it gets you in the door and closer to the game. looking for a way to get close to this location technology? tonight, cramer zeros in on zebra technologies and its game-changing acquisition that could be changing its stripes. all coming up on "mad money." (mother vo) when i was pregnant...
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and get the right care and guidance-before and after the baby is born. simple is good right now. (anncr vo) innovations that work for you. that's health in numbers. unitedhealthcare. how is it that we can have interest rates at ultra low levels, yet the housing market doing quite poorly? how can this sector be so stagnant even after we got such a terrific jobs number last week? should we give up on everything we thought we knew about this whole relationship between interest rates and housing? that's a question we want to examine on tonight's "off the charts" with the help of a brilliant chartist from as well as being behind the trifecta newsletter.
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i featured him in "get rich carefully" because he's correct. when you look at the longer term charts you notice something that's not vizible in the short term. he points out a significant lag between when interest rates fall and when mortgage activity picks up. but he also said that the trend still exists even in a moment like this one when we have the lowest level of mortgage lending in 14 years. l.a. times story a couple of weeks ago said that. take a look at the ishares dow jones home construction etf. the etb. right now, lange points out this index has climbed back to where it was in 2007 and 2008. when ten-year treasuries were supporting a ten year interest rate. even if you get a major rebound in interest rates with it catapulting back to 3%, then the housing stock should be fine. this is kind of to say don't
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worry about it, don't worry about it we'll be fine chart. the itp hasn't had a nasty correction since 2011. when you look at this chart you can see it's traced out a nice cup and handle pattern which is very, very bullish. and suggests that this -- which everybody suddenly hates is going high. now, let's look at the next chart. which shows the performance of this itb versus the yield on the ten year, i know it looks confusing, what lange points out here is that each time when yields have fallen, right, when yields have fallen, interest rates go down. the itb is on the rebound. of course, why not, right? cheaper to get a loan. the lower rates have been leading to more mortgage activity. just that it sometimes takes time for this to happen. you can't overstate the performance of bond yields. when treasury yields started to spike last spring, here you go, you see this huge run?
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after the fed began to talk about tapering, we got a hideous decline in the home builders. as you can see right here. when bond yields pulled back last september, all right, again, and again, this january, that helped boost the stocks of the home builders. you can see, the rates go down. then we get this opposite, okay. but it's cause and effect. the cause is this tnx. when bond yields stabilized in february, lange thought that contributed to a pull back in the itb. let's zoom in on the next chart. the same relationship. the yield of the ten year is measured by the tfx rather than the itb. i think this is very dispositive. this lately the yield on this ten year had fallen to the lowest level in three months, okay? so again, go to tnx. see this decline the ten year? not the decline in the interest rate, but it's nearing a test of
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the february lows. here es the february low. see, hasn't taken it out yet. if we were looking at a chart of the 30 year, we'd already see that it's fallen to the lowest level in ten months. even though we haven't seen mortgage rates decline, that could be right around the corner because treasury yields have gone so low. something that can lead to the revival in the home building stocks. mortgages aren't the only expense that goes into buying a house. look at the lumber futures. another major ingredient in building a home. lately, lumber futures have been on the rise. lang notes that already retraced 50% of the dow moved from the high of 410 when interest rates bottomed in march of 2013, falling to a low of 275. couple of months later. since then, lumber futures have been working their way higher. slowly but surely, although there's a bit of a pull back. the lumber is headed higher. we may have more demand for new
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homes than we think. don't worry about that. we know this connection makes sense because when lumber futures caught fire back in 2012, the itb went higher. another leading indicator that should say the itb is going higher. in short, with interest rates super low, if history is any guide we'll see a nice rebound in mortgage activity here. something which is being forecasted by the fact that lumber futures are overall higher, indicating that we have some construction going on in this country. we may have less refinancing act uptivety right now. however, the lack of new mortgage activity has to do with seasonality, weather, not to mention less refinancing going on. everybody who could refinance has already done so. he believes mortgage rates will fall. mortgage activity will rebound and so will the stocks. the charts as interpreted by bob lange defies the reason for them
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to decline like they have. his explanation, more affordable mortgages are coming and that will lead to a rebound. i'm not as sanguine about it as bob. there seems to be less supply of homes, just inventory at too high of a price. realogy confirmed this yesterday. called me a skeptic. still, lange has a good track record on the show. i think you should at least listen to what the guy is saying. james in connecticut. james? >> caller: hi, jim. a big booyah from newington, connecticut. >> nice. >> caller: love your show. thank you for helping out the little guy. my stock is foster wheeler. with the latest acquisition, do you think they'll gain more global exposure and do you think china will purchase their environmental and -- >> i think that group is too
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dicey here. i don't want to rely on the chinese. i think strongly that that's a group you want to kind of stay away from right now. there's lots of good companies with good dividends that i'm really preferring here. those are momentum construction names. how about mike in new jersey, mike? >> caller: jim, what's happening? >> i don't know, man, this market is tough, you know that? i'm trying to get people in the right ones and out of the wrong ones. it does -- it's the losses that are just horrendous for the wrong ones. what's up? >> caller: it is. definitely up and down. sometimes you take the winners and you run. >> yes. >> caller: i called you a couple of months ago, scott's miracle grow took a dip as you expected. i see it going higher, what do you think of this time of the season? >> i have been burned on scott's because it's weather related. things didn't work out a couple of times. i know a good quarter when i see it, scott's is one. the market is so skittish it hasn't happened.
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everyone is look for a turn in the housing. our charters think he's found it in the potent yields. what do you think? i'm not so sure. but lange has had such a good track record i think it's worth a look. i've got a real view. what do fedex have in common with you? an investment in a company. "mad money" is back after the break. tomorrow kick off the trading day with "squawk on the street." live from post 9. >> no more quintanilla. >> no one can replace quintanilla. we needed 30 new hires for our call center.
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as part of my on going job of finding you the next bull markets i'm always searching for companies that are trying to take control of their own destiny and their own stock price. which brings me to zebra technologies. stock in the book. they make thermal and receipt printers and radio frequencies and back on april 15th, we learned that they're buying motorola solutions enterprise business for $3.5 million and it
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got slammed. as investors were initially skeptical. since then, they have rebounded like crazy as the stock has climbed back up to $73.98 making a new all time high today. they reported a solid quarter this morning. even though you may have missed your chance to buy zebra in the weakness, you can get bargain prices here. let's check in with anders gustafsson, the ceo of zebra technologies to learn more about the quarter and the company's deal. mr. gustafsson, welcome to "mad money." thank you so much. have a seat. >> thank you. thank you. >> so initially, the market doesn't understand the deal. they say, well, wait a second, zebra is growing at 18%. why does 18% and minus 1 make so much sense? >> 18 -- >> 18 is growing much faster than momotorola, and people
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realize two plus two equals five. >> right. we have had the same customers really offering two halves of a complete solution. i think we have a chance of creating something quite unique with what we're putting together and the synergies, you know, the new types of solution that we can create i think is very appealing. >> okay. before you merged with motorola and he said you're going ahead to head, zebra versus cymbal. you can get more customers together. >> actually, we're very complimentary. so what we print, what motorola enterprises read. so we print the bar code and encode the tag and they read it. so we actually don't have any overlap in the product solutions. it's complimentary. >> let's talk about what the solutions are. because you're on with a ton --
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almost every fortune 400 company uses you. but there's a fantastic story about you tagging the san francisco 49ers to see how they're doing. what is that? >> we had a pilot program to tag the 49ers and the lions -- >> so we put -- >> so we put two rfds on the shoulder pads, how many yards they're running in the first versus the last quarter. any kind of statistics around it. >> the reason i thought this was so exciting, we all know now that a lot of devises that we use, that we put on our arms aren't doing the job. could you make a deal with an under armour and offer superior tracking technology? >> we can definitely track at great accuracy what anybody does on the field and we can put leads in for temperature monitoring, other things like that to give you the biometric information as well. >> obviously the real uses that you talk about over and over again, retail and health care.
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what do you do for health care? i think retail we have seen a couple. >> yeah. in a -- in health care, you know, we have a number of new cases. we do anything from wrist bands on patients. putting machine readable instructions on pill boxes and on the -- >> so no mistakes. >> yeah. so basically we can say at the bedside of the patient, the caregiver can scan the bar code on the wrist band. scan the pill box and his or her own credentials to make sure the patient gets the right dose at the right time by an authorized caregiver. >> you have cut back on malpractice then? >> absolutely. so we have a lot of case studies looking at how much money we save the hospitals or health care administrations. and it's -- it's medium sized health care providers saved $14 million by using or technology. >> 40? >> 14. >> for retail i want to talk
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omni channel. looks like we know from macy's, we know that companies are trying to integrate. just to beat amazon. whether do you it in in the omni chann chann channel? >> we do a lot for them. we give them great visibility on in-store inventory. they can put the rfd tags on the inventory. we have a cloud based service which we have a recorder on a regular basis does a physical inventory count. so the retail has much better visibility to what actual inventory they have. >> i'm averse to debt myself, but you took down billions from this acquisition. with the stock flying as high as it is in a market beaten down, this is a chance for a company to get in on the secondary where you can pay down the debt. would you offer up the stock -- >> we haven't decided yet. but first, we are comfortable
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with the debt structure we put on. we are two leaders in the industry. we have strong cash flow generating capabilities. we expect within three years we'll pay down the debt. >> pay down a lot of the $3 billion? >> five times to 30 times. >> that would be terrific. >> if you look at the interest rates today, if you compare that to somebody half our debt load they're paying more interest costs. >> a good point. the money -- that's anders gustafsson. you know we've been recommending zebra. i just still think -- i believe in the company, i'm not asking you to chase it though. stay with cramer. "lightning round" is coming up.
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and use one of our certified repair shops, the repairs are guaranteed for life. so call... to talk with an insurance expert about everything that comes standard with our base auto policy. and if you switch, you could save up to $423. liberty mutual insurance -- responsibility. what's your policy? >> announcer: lightning round is sponsored by td ameritrade. >> oh, boy, is it time. it is time for the lightning round. you say the name of the stock. i don't know the calls or the name of the stock ahead of time. i tell you whether to buy or sell. when you hear this sound -- [ buzzer ] -- then the lightning round is over. are you ready, skee-daddy? time for the "lightning round." start with joslin in oregon. joslin? >> caller: hi, jim. >> hi, joslin. >> caller: i love this show. highly entertaining.
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>> thank you. >> caller: you're the man. what's your take on opk? >> a speculative stock in this environment. i tend to pull back from speculation. it's not working. i wish he'd come on the show and get a better read of how it's done. it's been a big winner for us. sammy in louisiana. >> caller: booyah. >> what's happening? >> caller: i'd like you to autograph both of my books, "get rich carefully" and "real money." >> i love shreveport, pretty city. what's up? >> caller: if you ever get here again, please come by. because you're absolutely the greatest in the world. >> absolutely. sounds good. >> caller: and also, i want to find out what's the update with gmcr -- >> i thought when coca-cola had taken the stake, it was gone. the longs don't have the pull. i'm going -- it was great. thank you. congratulations. let's go to ed in florida,
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please. >> caller: jim, booyah, cramer. >> booyah. >> caller: i'm from philly originally. >> holy cow, so is my dad. what's going on? >> caller: i wanted your take on win energy -- >> i want the company to come on the air. i didn't like the quarter. they bought this company, i expected here from them. i don't know if they can raise their distribution. i want mr. mark ellis to come back. a standing invite right now. 10% yield, do i want it, i don't know. i need more information. >> caller: hey, with the problems that russia is creating in europe and they're shipping liquefied gas in the ukraine, what do you think about gas log? >> i think this area has gotten too inflated. i think they're up too much on a wing and a prayer. i don't so anything happening in the near term in this group that much. i know that stock is up a lot. i would prefer to ca-ching, ca-ching. because i had enough problems
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with speculative stocks, it's a little rich for my taste. mike in florida, mike? >> caller: booyah, jim, love the show. >> thank you. >> caller: here's the stock i learned about from watching your show. bought it before the earnings pop last week. westport innovations? >> no, you're not going to get an endorsement from me. the show is not about friends, but about making money. and they have not made you money. let's go to kyle in hawaii. kyle? >> caller: booyah, jim. love the show, love the book. >> thank you. thank you. >> caller: -- national -- yeah, my company is national oil -- >> last week, it was a good quarter. it goes from 82 down to 87. it's all the way back. i like it. and that's the conclusion of the "lightning round"! [ buzzer ] >> announcer: the lightning round is sponsored by td ameritrade. came big business ov?
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if you want evidence it's possible for companies to turn things around, take one look at pitney bowes. pbi for you home gamers. here's a company company that used to be in the business of snail mail. but obviously, that's an old fashioned business. and paper mail is not exactly growth. it doesn't give it to you, so
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pitney bowes had to recreate itself. as an outsource services provider under the umbrella of the u.s. postal industry. while it's still the number one supplier of mail meters it's a digital company, having a partnership with e-bid. the recent results have been strong. pitney bowes reported a solid quarter last week. the stock has been on tear, rallying up more than 140%. since mark lawn took back over as the ceo. even though the dividend was cut in half, the stock still yields a solid 2.8%. let's check in with the president and the ceo of pitney bowes. find out more about how the company is doing. mr. lawenback, thank you. and have a seat. >> glad to be here. >> i'm -- when you think of a transformation, you have to start with the most -- i'd say eye opening one. used it in the presentation last year which is that people wrote off the mainframe where you worked and look at how that's done. that's what pitney is doing. >> well, it is.
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if you lock at -- look at businesses as we sit here today, we have got some incredibly exciting growth opportunities. we facilitate $1 billion of e commerce transactions each year. 1.2 billion people use our technologies through our relationship with twitter and facebook. we have a great, perhaps not exciting business, but to me, really great business. around mail meters which continues to be a very important part of our overall model. >> well, what i'm looking for are stocks that offer growth, the old fashioned way. with the expanding margins. that has been a theme through everything that you have said since you took over the company. >> those were my exact words a week ago. if you look at the first quarter it was growth the old fashioned way. we hit 3% growth. 9% adjusted ebitda. it was exactly our long term economic model. >> to company -- the old company sold off cash. the new company, digital business, looks like you have
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35% of your business and is growing double digit. >> actually growing 23% in the most recent quarter. grew 16% in the previous quarter. >> accelerated revenue growth. through the third and fourth quarter. >> absolutely. i'm giving -- given our business with ebay, you'd think the fourth quarter is the high point. didn't turn out to be true. but the important thing about the markets they represent $25 billion of addressable opportunity for us. so we have a nice business there. >> so someone -- i'm on ebay, a seller, someone from australia wants my product. how do i get it to them? >> simple, log on to ebay the software that you use with ebay. ours is under the covers so software that says can it go to australia, can't cross borders? how much it costs to get there. what the duties are. and who the right shippers -- that's all our software. right underneath the covers. a simple transaction.
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so it takes all the friction out of the trade. >> okay, the mapping business. why does pitney bowes have any edge at all in mapping? >> because of the algorithms. if you look at the math that puts you in the particular longitude or lat today, we have the best goods. i say that not because our people tell us that, but i hear it from the clients over and over again. we're in competitive bakeoffs against names you'd know. we win on a consistent basis. >> why do i want your tracking software, when i go to fedex or u.p.s. they have the greatest ones in the world. >> they track their stuff, we track everyone's stuff. all the shippers we track. that's the advantage, because they have certain ways, but we do it all the way around the world. >> you're paying down debt. is it enough is enough or do you want to pay it down and make acquisitions with a stock that's going up a lot? >> if you look at our capital
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allocation strategy over the last 12 or 14 months we have paid down a lot of debt. that's a given us a strong balance sheet. that secured the dividend. it's provided the flexibility to pursue with organic and nonorganic types of opportunities to pursue the exciting growth opportunities. we like where we are. >> in the meantime, people have post and meters. >> it throws off a lot of cash. thatted by looks to be a good -- that business looks to be good. >> i'm rooting for you guys. you obviously pulled it off. i know it's -- we're still early. make that very clear. >> a lot is done. lots more we'll do. >> excellent. that's the president and the ceo of pitney bowes. you know i was excited about this company when we did our analysis of what's strong in the s&p. there's a lot more upside. stay with cramer. stay with cram. well, did you know that game show hosts should only host game shows? samantha, do you take kevin as your lawfully wedded husband...
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or would you rather have a new caaaaaar!!!! say hello to the season's hottest convertible... ohhh....and say goodbye to samantha. [ male announcer ] geico. 15 minutes could save you 15% or more. [ male announcer ] geico. honestly, the off-season isn't i've got a lot to do. that's why i got my surface. it's great for watching game film and drawing up plays. it's got onenote, so i can stay on top of my to-do list, which has been absolutely absurd since the big game. with skype, it's just really easy to stay in touch with the kids i work with. alright, russell you are good to go! alright, fellas. alright, russ. back to work!
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♪ ♪fame, makes a man take things over♪ ♪fame, lets him loose, hard to swallow♪ ♪fame, puts you there where things are hollow♪
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the evolution of luxury continues. the next generation 2015 escalade. ♪fame all right. some mixed results tonight after the bell. we had pioneer, you know one of my favorite oil companies joined the parade of eog with great oil great. disney looked like a solid number. no doubt about it. ea was extraordinary. but on the other side, fireeye. i don't know, we're going to rename it sharp stick in the eye frankly. more guidance cuts.
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we had the good trade on, but boy, that stock had not so great pit action this evening. let's not forget this is a market dominated by value. sell the growth. there's always a bull market somewhere. i promise to find it right here on "mad money." i'm jim cramer. see you tomorrow! >> i go inside a. stein meat products, a wholesale meat supplier in brooklyn, new york, that does $50 million of revenue annually. >> good burger. >> it's the best. due to high operating costs and razor-thin margins, stein is hemorrhaging cash. >> everybody you order from, wants their money in ten days. we don't have the money to pay them. >> i can't turn this business around... this business is two weeks away from closing. this 75-year-old company will close for good. my name is marcus lemonis. i fix failing businesses. i make tough decisions. and, frank, you are no longer the general manager. and i back them up with my own cash. it's not always pretty. >> perfect flavor. >> but this is business.


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